Gabriella Joanne, Melinda Haryanto


This research aims to analyze the impact of ownership structure and corporate governance on profitability and firm value. The profitability and firm value, which are the dependent variables in this study, will be calculated using ROA (Return on Assets) and Tobin’s Q. Ownership structure and corporate governance as the independent variables consist of institutional and government ownership, board size, independent board member, and type of auditor with size of firm, debt ratio, dividends yield, and age of company as the control variables.
The samples that are used in this research are the 24 consumer goods industry companies that are listed in the Indonesia Stock Exchange. The technique that is used in this research is multiple regression analysis.
The result of this research shows that there is a significant positive influence of type of auditor on ROA (Return on Assets) and Tobin’s Q. Moreover, institutional ownership and board size has a negative significant influence on ROA and Tobin’s Q. While, government ownership and independent board member has a negative but insignificant impact on ROA and Tobin’s Q.

Full Text:



Alfaraih, M., Alanezi, F., & Almujamed, H. (2012). The Influence of Institutional and Government Ownership on Firm Performance: Evidence from Kuwait. International Business Research, 5(10), 192-200. doi:10.5539/ibr.v5n10p192

Aljifri, K., & Moustafa, M. (2007). The Impact of Corporate Governance Mechanisms on the Performance of UAE Firms: An Empirical Analysis. Journal of Economic & Administrative Sciences, 23(2), 71-93. doi:10.1108/10264116200700008

Al-Malkawi, H., & Pillai, R. (2012). Internal Mechanisms of Corporate Governance and Firm Performance: A Review of Theory and Empirical Evidence. Journal of Modern Accounting and Auditing, 8(4), 549-568.

Al-Najjar, D. (2015). The Effect of Institutional Ownership on Firm Performance: Evidence from Jordanian Listed Firms. International Journal of Economics and Finance, 7(12), 97-105. doi:10.5539/ijef.v7n12p97

Al-Zaidyeen, K. A., & AL-Rawash, S. Z. (2015). The Effect of Ownership Structure on Corporate Performance of Listed Companies in Amman Stock Exchange: An Empirical Evidence of Jordan. International Journal of Managerial Studies and Research, 3(5), 41-49.

Arens, A. A., Elder, R. J., & Beasley, M. S. (2014). Auditing and Assurance Services (15th ed.). Boston: Pearson.

Aryan, L. A. (2015). The Relationship between Audit CommitteeCharacteristics, Audit Firm Quality and Companies’ Profitability. Asian Journal of Finance & Accounting, 7(2), 215-226. doi:10.5296/ajfa.v7i2.8530

Bebeji, A., Mohammed, A., & Tanko, M. (2015). The Effect of Board Size and Composition on The Financial Performance of Banks in Nigeria. African Journal of Business Management, 9(16), 590-598. doi:10.5897/ajbm2015.7797

Berghe, V. L., & Levrau, A. (2004). Evaluating Boards of Directors: What Constitutes A Good Corporate Board?. Corporate Governance: An International Review, 12(4), 461-478. doi:10.1111/j.1467-8683.2004.00387.x

Bouaziz, Z. (2012). The impact of the presence of audit committees on the financial performance of Tunisian companies. International Journal of Management and Business Studies, 2(4), 57-64.

Cadbury, A. (1992). Report of the Committee on the Financial Aspects of Corporate Governance. London: Gee.

Carcello, J. V., & Nagy, A. L. (2004). Client Size, Auditor Specialization and Fraudulent Financial Reporting. Managerial Auditing Journal, 19(5), 651-668. doi:10.1108/02686900410537775

Deloitte. (2016, February). Independent board members can be a valuable resource for private companies (Rep.). Retrieved

DeZoort, T., Hermanson, D. R., Archambeault, D., & Reed, S. (2002). Audit Committee Effectiveness: Asynthesis of The Empirical Audit Committee Literature. Journal of Accounting Literature, 21, 38-75.

Fooladi, M. & Shukor, Z. A. (2012). Board of Directors, Audit Quality and firm performance: Evidence from Malaysia. Paper presented at the National Research & Innovation Conference for Graduate Students in Social Science, Mahkota Hotel, Melaka.

Forum for Corporate Governance in Indonesia. (2001). Corporate Governance:Peranan Dewan Komisaris dan Komite Audit dalam Pelaksanaan Corporate Governance (Tata Kelola Perusahaan). Jakarta:Prentice Hall.

Fredrick, O. O. (2015). Corporate Governance And Firm Value For Firms Listed At The Nairobi Securities Exchange. Unpublished Master’s Thesis, University of Nairobi, Nairobi, Kenya.

Fuzi, S. F., Halim S. A., &Julizaerma, M. K. (2016). Board Independence and Firm Performance.Procedia Economics and Finance, 37, 460 – 465.

Guest, P. M. (2009). The Impact of Board Size on Firm Performance: Evidence from the UK. The European Journal of Finance, 15(4), 385-404. doi:10.1080/13518470802466121

Gursoy, G. & Aydogan, K. (2002). Equity Ownership Structure Risk Taking and Performance: An Empirical Investigation in Turkish Listed Companies. Emerging Market Finance and Trade, 38(6), 6-25.

Halil, E. A. & Hassan, A. (2012). The effect of firm size on profitability: An empirical Icelandic firms. Bitrost Journal of Social Sciences, 1, 33-42.

Hanazaki, M., & Liu, Q. (2007). Corporate Governance and Investment in East Asian Firms - Empirical Analysis of Family-Controlled Firms. Journal of Asian Economics, 18(1), 76-97. doi:10.1016/j.asieco.2006.12.003

Harrison, W. T., Horngren, C. T., & Thomas, C. W. (2014). Financial Accounting (10th ed.). Toronto, Ontario: Pearson Education.

Hashim, H.A. & Devi, S. (2008). Board characteristics, ownership structure and earnings quality: Malaysian evidence. Research in Accounting in Emerging Economies, 8, 97-123.

Hassan, S. U., & Farouk, M. A. (2014). Audit Quality and Financial Performance of Quoted Cement Firms in Nigeria. European Journal of Business and Management, 6(28), 73-82.

Hovey, M., Li, L., & Naughton, T. (2003). The Relationship Between Valuation and Ownership of Listed Firms in China. Corporate Governance, 11(2), 112-122. doi:10.1111/1467-8683.00012

Isik, O., & Ince, A. R. (2016). Board Size, Board Composition and Performance: An Investigation on Turkish Banks. International Business Research, 9(2), 74-84. doi:10.5539/ibr.v9n2p74

Jackling, B. & Johl, S. (2009). Board Structure and Firm Performance: Evidence from India’s Top Companies. Corporate Governance: An International Review, 17(4), 492–509. doi: 10.1111/j.1467-8683.2009.00760.x

Jensen, M. C. (1986). Agency Costs of Free Cash Flow, Corporate Finance, and Takeovers. The American Economic Review, 76(2), 323-329.

Jensen, M. C., & Meckling, W. H. (1976). Theory of the Firm: Managerial Behavior, Agency Costs, and Ownership Structure. Journal of Financial Economics, 3(4), 305-360. doi:10.1002/9780470752135.ch17

Johnson, S. (2000). Observations on Corporate Governance in the Asian Crisis. Global Financial Crises, 297-306. doi:10.1007/978-1-4615-4367-1_29

Keasey, K., S. Thompson and M. Wright (eds.), 2005, Corporate Governance: Accountability, Enterprise and International Comparisons. London: Wiley.

Kim, K. A., & Nofsinger, J. R. (2007). Corporate Governance (2nd ed.). New Jersey, USA: Pearson/Prentice Hall.

Kimmel, P. D., Weygandt, J. J., & Kieso D. E. (2013). Financial Accounting IFRS Edition. Hoboken, New Jersey: John Wiley & Sons, Inc.

Knyazeva, A., Knyazeva, D., & Masulis, R. (2013). The Supply of Corporate Directors and Board Independence. Review of Financial Studies, 26(6), 1561-1605. doi: 10.1093/rfs/hht020

Kao, M. F., Hodgkinson, L., Jaafar, A. (2013, July). Board Characteristics, Ownership Structure and Firm Performance: Evidence from Taiwan. Paper presented at the Seventh Asia Pacific Interdisciplinary Research in Accounting Conference, Kobe, Hyogo.

Lasfer, M. (2002). Board Structure and Agency Costs. Paper presented at the EFMA 2002 London Meetings, London, England.

Lukviarman, N. (2004). Ownership structure and Firm Performance: the Case of Indonesia. Unpublished Doctoral Dissertation. Curtin University of Technology, Perth, Western Australia.

Mak, Y. T., & Kusnadi, Y. (2005). Size Really Matters: Further Evidence on the Negative Relationship Between Board Size and Firm Value. Pacific-Basin Finance Journal, 13(3), 301-318. doi:10.1016/j.pacfin.2004.09.002

Najid, N., & Abdul Rahman, R. (2011). Government Ownership and Performance of Malaysian Government-Linked Companies. International Research Journal of Finance and Economics, (61), 42-56.

Ness, R. K., Miesing, P., & Kang, J. (2010). Board of Director Composition and Financial Performance in a Sarbanes-Oxley World. Academy of Business and Economics Journal, 10(5), 56-74.

Qasim, A. M. (2014). European Journal of Business and Management. The Impact of Corporate Governance on Firm Performance: Evidence from the UAE, 6(22), 118-124.

Rose, C. (2007). Can Institutional Investors Fix the Corporate Governance Problem? Some Danish Evidence. Journal of Management and Governance, 11(4), 405-428.

Solomon, J. (2007). Corporate Governance and Accountability (2nd ed.). Chichester, England: John Wiley & Sons.

Solomon, J., & Solomon, A. (2004). Corporate Governance and Accountability. Chichester, England: John Wiley & Sons, Ltd.

Topal, Y., & Dogan, M. (2014). Impact of Board Size on Financial Performance: The Case of BIST Manufacturing Industry. International Journal of Business Management and Economic Research, 5(4), 74-79.

Tran, N. M., Nonneman, W., Jorissen, A. (2014). Government Ownership and Firm Performance: The Case of Vietnam. International Journal of Economics and Financial Issues. 4(3), 628-650.

Tricker, B. (2009). Corporate Governance: Principles, Policies, and Practices. Oxford, UK: Oxford University Press.

Vo, D., & Phan, T. (2013). Corporate Governance and Firm Performance: Empirical Evidence From Vietnam. Journal of Financial Economics, 78, 210-226.

Walt, N., & Ingley, C. (2003). Board Dynamics and the Influence of Professional Background, Gender and Ethnic Diversity of Directors. Corporate Governance: An International Review, 11(3), 218-234. doi:10.1111/1467-8683.00320

Wei, G. (2007). Ownership Structure, Corporate Governance and Company Performance in China. Asia Pacific Business Review, 13(4), 519-545. doi:10.1080/13602380701300130

Wei, Z., & Varela, O. (2003). State Equity Ownership and Firm Market Performance: Evidence From China’s Newly Privatized Firms. Global Finance Journal, 14(1), 65-82. doi:10.1016/s1044-0283(03)00005-x

Wei, Z., Xie, F., & Zhang, S. (2005). Ownership Structure and Firm Value in China's Privatized Firms: 1991–2001. Journal of Financial and Quantitative Analysis, 40(1), 87-108. doi:10.1017/S0022109000001757

Weterings, J. P., & Swagerman, D. M. (2012). The impact of board size on firm value: Evidence from the Asian real estate industry. Asian Journal of Business and Management Sciences, 1(8), 22 - 43.

Zeitun, R. (2009). Ownership Structure, Corporate Performance and Failure: Evidence From Panel Data of Emerging Market. Corporate Ownership and Control, 6(4), 96-114. doi:10.22495/cocv6i4p10



  • There are currently no refbacks.

Jurakunman (Jurnal Akuntansi dan Manajemen)
Print ISSN 2086-681X /Online ISSN 2654-8216

Published by

STIE Surya Nusantara
Jln. Rakoetta Sembiring Kec. Siantar Martoba, Kota Pematang Siantar, Sumatera Utara 21143

Jurakunman Published Papers Indexed/Abstracted By: